Tables
Table 1- Principles of responsible fiscal management: Public Finance Act (1989)
1. The PFA specifies the following principles of responsible fiscal management:
- reduce debt to prudent levels so as to provide a buffer against factors which may impact adversely on debt in the future, by ensuring that, until those levels have been achieved, total operating expenses in each financial year are less than total operating revenues;
- once prudent levels have been achieved, maintaining those levels by ensuring that, on average, over a reasonable period of time, total operating expenses do not exceed total operating revenues;
- achieving and maintaining levels of total net worth that provide a buffer against factors which may impact on net worth in the future;
- managing prudently the fiscal risks facing the Government;
- pursuing policies which are consistent with maintaining a reasonable degree of predictability about the level and stability of taxation rates in the future.
2. Reporting requirements under the PFA include
- The Government must publish a Budget Policy Statement before April each year setting out their priorities for the Budget and any changes in long-term objectives and short-term intentions (see below). Recent Budgets have used a themes approach to prioritising government expenditure. The 2007 Budget specified the themes to be “families, young and old”, “national identity” and “economic transformation”;
- Treasury must produce an economic and fiscal update covering the current year and next two. An update must be produced prior to 31 December, with each Budget and prior to an election. Assumptions used in the update are those of the Treasury. The fiscal update must include financial statements prepared under GAAP and a statement of specific fiscal risks – that is government decisions and explicit contingent liabilities. Assumptions used in the update are those of the Treasury;
- A statement on major tax policy changes must be published with each Budget. This sets out the intended change and the cost of the policy;
- Governments must publish with each Budget a Fiscal Strategy Report setting out short-term intentions for key fiscal variables over the next 3 years, long-term objectives for those variables and projections of those fiscal variables over a period of at least 10 years. The FSR is the Minister’s document and hence projections are based on the Minister’s assumptions;
- The Treasury is also required to make fiscal projections over a period of 40 years at least every 4 years.
Table 2 - Employment in the public and private sectors
(Filled jobs, June years 2000 and 2006)
| Filled jobs | Level (000s) | Change | ||
|---|---|---|---|---|
| Years to June | 2000 | 2006 | (000s) | % per annum |
| Total sectors | 1,408,600 | 1,687,400 | 278,800 | 3.1 |
| Total private sector | 1,144,100 | 1,381,100 | 237,000 | 3.2 |
| Total public sector | 264,500 | 306,300 | 41,800 | 2.5 |
| Public service | 31,000 | 42,100 | 11,100 | 5.2 |
| Health services | 48,000 | 56,400 | 8,400 | 2.7 |
| Education | 106,500 | 106,000 | -500 | -0.1 |
| Other public sector | 79,000 | 101,800 | 22,800 | 4.3 |
Source: Statistics New Zealand
Note: Public sector includes central government and local government. Public service is central government.
